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Tuesday, November 13, 2012

Steady on the course towards a downward recovery

For the last years we've been told bedtime stories about recovery, jobs, and growth. Grandiose bedtime stories of recovery in Europe, fantasy tales about how Fukushima was just a mild problem - growth will resume, just wait. Throughout it all I've even heard staunch CPC opponents refer to Canada's "strong and stable" banking system, usually referring to the revisionist history the left is fond of remembering, 'Paul Martin: of surpluses and happier times'.

Today, news networks are scrambling to get interviews with the "experts" who are always wrong. Today you'll be able to hear why they were wrong, and why they're right about why they were wrong. The confidence game is in full swing, confused Canadians: an expert is waiting to persuade you.

Interest rate hike? Isn't going to be happening, just as I've told you. At least, until Canada and the Eurasian nations feel ready to decouple from the USD. However, the lack of doing so isn't going to prevent Canada's downward spiral as consumer debts continue to build up which will sooner or later bring a seemingly complete halt to the consumer spending component of Canada's GDP. These will weigh on forecasts and since the cost of the future is defined by the prosperity of the present, that cost will continue to escalate. Slow and unreliable growth will be the defining factor of the next year of extremely volatile oil prices and I feel that Canada's extreme energy industry will be feeling this year's volatility quite heavily. The fairly predictable osculation between $80-$100 largely due to oil price fixing won't be nearly as predictable this year as even the heavy weight of central banks and oil manipulators will not be able to keep stability in face of an increasingly volatile global economy.

Canada's unseen deficit
The federal deficit is really not where the major problems will first start arising though, as the federal government will be pushing more and more costs on to provinces to save face which in turn will be pushing more and more costs on to cities to save face. Looking at the U.S., it is the cities which are going bankrupt first, this will then escalate to states (as it has in some cases already), and finally the federal government will have nowhere to hide the true state of it's bad finances.

The 'backup plan' seems to be exactly the plan I've been writing about, but backup? No. This is our primary plan now and I'm pretty sure it has been for awhile. The U.S. is preparing for complete lockdown and totalitarianism because the government there (and also everywhere else) knows that the U.S. hasn't yet even seen the beginning of their economic collapse. When it comes, they'll be ready, no doubt about that.

Of course, the "fiscal cliff" is a public relations tool being used to focus the public's attention just as the "debt ceiling" was used before to set the stage for this "fiscal cliff". This is a progressive propaganda campaign design to acclimate the population to an ever worsening situation without causing panic. Once again, it's all about the confidence game. As long as you remain confident everything is ok, you'll remain apathetic and asleep. As one lady who was interviewed at the CPC's election party said: "now with a conservative majority we don't have to worry about the economy, and I can just focus on partying!". Party on.

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Richard Fantin is a self-taught software developer who has mostly throughout his career focused on financial applications and high frequency trading. He currently works for eQube gaming systems.

Nazayh Zanidean is a Project Coordinator for a mid-sized construction contractor in Calgary, Alberta. He enjoys writing as a hobby on topics that include foreign policy, international human rights, security and systemic media bias.